Making It Work When The Neighborhood Is Tough

Alton Dunk smiles as he talks about his first days in the business.

He says he plowed $6,000 of savings into the renovation of a tiny, storefront, take-out restaurant, but ran out of money before he could buy a stove.

Undaunted, Mr. Dunk went ahead and opened the doors of Soul Food Kitchen, and then spent four months rushing hot platters of barbecued pork and collard greens down the stairs and around the corner from the stove in his mother's apartment into his restaurant.

Today, eight years later, Dunk stands in front of one of the four vans that service his $1 million catering business and shakes his head as he reminisces.

A small loan would have made his life much more comfortable, and the early months of his business much more viable, "but where was I going to get a loan?" he asks.

Starting, then running, a small business is no easy task under the best of circumstances, not when you have venture capitalists clamoring to invest millions, not when you have banks willing to bankroll your location on Madison Avenue or its equivalent.

But when the entrepreneur belongs to a minority, and when the business address is in a neighborhood considered "tough," the battle to start going, then keep going takes grit.

Dunk's restaurant lies in the heart of New York City's Bedford-Stuyvesant, a tough Brooklyn neighborhood where an estimated 35 percent of the residents live below the poverty line - not an appealing prospect for a bank loan.

But what about a community development corporation (CDC)? More than 2,000 of these nonprofit groups link public and private resources, helping entrepreneurs like Dunk connect with lending institutions.

"I tried calling them," he remembers. "As soon as I heard about all the paperwork they wanted, I just hung up. All I felt was frustrated."

Dunk's story is all too common, say some who work with inner-city entrepreneurs.

Despite decades of a myriad of public and private urban economic initiatives, despite the best efforts of university think tanks, urban economists, and well-intentioned philanthropic groups, the very entrepreneurs the inner city most needs often feel they have nowhere to turn when launching a business.

That's especially true when it comes to the question of raising capital - money.

"Disconnect" describes the gap between the needs of many small-scale urban entrepreneurs and the programs intended to help them, says Anne Habiby, director of research for Boston's nonprofit Initiative for a Competitive Inner City.

Overlooking the little guy

It may occur because many businesses are too small to attract the attention of organizations interested in more sweeping change.

Or it could be that a baffling mountain of paperwork stands between an entrepreneur and the help he or she may otherwise qualify for.

But often, Ms. Habiby insists, it's because, until recently, public and private groups dedicated to helping the inner city were not "geared towards understanding business," and failed to focus realistically on the needs of promising smaller entrepreneurs.

Detroit restaurateur Sherman Sharpe feels Dunk's pain. In 1986 he left his law practice to pursue his dream of creating an upscale restaurant in downtown Detroit. The shift came, in part, because as a Detroit native he wanted to give the city "something to be proud of."

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